Executor tracing Gifts for IHT

DubblyDubbly

Hypothetical question. Now that we regularly switch bank accounts and have paperless statements what are the responsibilities of an executor get hold of 7 years of statements to see what gifts over the £3k per year have been made on an estate over the soon to be £1million IHT limit ? There is no obligation on the deceased to inform HMRC of gifts over £3k AFAIK so tracing bank accounts could be difficult.

Yorkshireman99

DubblyDubbly wrote: »

Hypothetical question. Now that we regularly switch bank accounts and have paperless statements what are the responsibilities of an executor get hold of 7 years of statements to see what gifts over the £3k per year have been made on an estate over the soon to be £1million IHT limit ? There is no obligation on the deceased to inform HMRC of gifts over £3k AFAIK so tracing bank accounts could be difficult.

It is up to the donor to keep accurate records of gifts made. Likewise the executor is expected to make an accurate probate application. Personally I keep a spreadsheet of all gifts made each tax year and print it off and file with my important papers. My executors are aware of this. Simples!

Keep_pedalling

If you are talking about your executor, then you should take the responsibility in leaving your executor details of your last 7 years of gifting.

I keep mine on a spreadsheet, and I send an updated copy to my solicitor once a year to be kept with our will. I also keep a paper copy in our safe with a copy of the will. Our IFA also has a copy.

I would hate to be an executor of someone who has multiple accounts and no gift records.

Robin9

How would you know what you're looking for - one gift of (say)£5k or 20 off £250

Tom99

[FONT=Verdana, sans-serif]To be honest unless the deceased has kept records for you it will be very difficult. If the estate is in IHT level then its quite possible they have had multiple account over the past 7 years as interest rates are chased, a number of which will now be closed.

[/FONT] [FONT=Verdana, sans-serif]I very much doubt whether most executors even ask for 7 years worth of the current account statements. Can a bank provide these and how much would they charge?

[/FONT] [FONT=Verdana, sans-serif]How deeply you delve would probably depend on how well you knew the deceases gifting habits and also the value of the estate. For example, someone with a £5m estate is much more likely to have given away more than £3,000 pa.[/FONT]

Yorkshireman99

Tom99 wrote: »

[FONT=Verdana, sans-serif]To be honest unless the deceased has kept records for you it will be very difficult. If the estate is in IHT level then its quite possible they have had multiple account over the past 7 years as interest rates are chased, a number of which will now be closed.

[/FONT] [FONT=Verdana, sans-serif]I very much doubt whether most executors even ask for 7 years worth of the current account statements. Can a bank provide these and how much would they charge?

[/FONT] [FONT=Verdana, sans-serif]How deeply you delve would probably depend on how well you knew the deceases gifting habits and also the value of the estate. For example, someone with a £5m estate is much more likely to have given away more than £3,000 pa.[/FONT]

The answer is not to take the executorshp on unless you are sure adequte records exist. Another good reason to actively engage with your executor(s) before you die.

Keep_pedalling

Just having multiple bank accounts is going to be a real pain. My wife had a phone call from the solicitors who handled her uncles estate and an account has come out of the woodwork 7 years after his death. It was not a small one either, over £6k after IHT has been deducted.

We have greatly simplifies our finances. 2 bank accounts, three cash savings accounts for emergency fund, and all investments held on a single platform looked afte4 by an IFA, which should simplify our executors job greatly.

unforeseen

Yorkshireman99 wrote: »

The answer is not to take the executorshp on unless you are sure adequte records exist. Another good reason to actively engage with your executor(s) before you die.

However wouldn't you need to take on the executorship to get access to the records which indicate whether or not you should take on the executorship

Yorkshireman99

unforeseen wrote: »

However wouldn't you need to take on the executorship to get access to the records which indicate whether or not you should take on the executorship

As I said before it would be unwise to agree to be executor unless you had had some dialogue with the testator before they died. Nothing forces anyone accept executorship. IMHO nobody should appoint an executor without first discussing it with them if at all possible.

Keep_pedalling

Yorkshireman99 wrote: »

The answer is not to take the executorshp on unless you are sure adequte records exist. Another good reason to actively engage with your executor(s) before you die.

A bit difficult to do if you are also one of the main beneficiaries. You could hand it over to a professional, but all that trawling through bank accounts is likely to be very expensive.

Without decent records the job is nearly impossible to do. If any one had to do on it on ours the first problem they would hit would be who gave what as all gifts have come from our joint bank account, but not all gifts were joint. There are also a couple of gifts over the annual allowance that are also exempt, because the were given in contemplation of marriage, but the executor may not have been aware of that so they could be declared as taxable in error.

Yorkshireman99

Exactly! Hence the need for accurate records. If it costs the estate then that is not the executor’s fault.